Despite crypto lender Celsius halting withdrawals on June 13 and declaring Chapter 11 bankruptcy on July 13, its native $CEL token has risen 30% since all hell broke loose.
What’s more, it’s outperforming the S&P 500. Over the last 30 days, the S&P 500 Index is up 4.61% while CEL is up 30.8%. If Celsius is bankrupt, it doesn’t take a rocket scientist to realize something strange is going on.
CEL vs S&P 500Many on Twitter speculated that there was reckless trading or “whale games” going on, but our source at crypto analytics firm Messari said this is not the case.
“The only way price goes down is that people sell. But in order for that to happen, they need to hold the tokens to sell in the first place,” Messari analyst Dustin Leander explained. “Currently, over 90% of the supply is held in various Celsius wallets. Celsius naturally isn’t a seller of their own token and the remaining holders aren’t large enough to drive the price down significantly.”
“Keep in mind the ‘value’ or market cap of the token is theoretical.”
Dustin Leander
If Celsius tried selling its supply of tokens, Leander believes Celsius “would likely find there are no buyers and the price would drop to reflect its true value”.
In the last 72 hours since Celsius filed for Chapter 11 bankruptcy, CEL has dropped from $0.91 to $0.45 and then shot back up to $0.78.
‘Definitely Zero’
Coinbase’s Pete Huang told The Defiant that $CEL “should definitely be zero”. @Route2FI, a researcher at Crypto index fund Alongside, also told The Defiant he thinks CEL will eventually go to zero, but hasn’t the slightest clue when.
While CEL has outperformed the S&P 500 in the last 30 days, the token went down 85.4% in the last year and 13.5% in the last fourteen days.
In their filing, Celsius confirms it holds $167M in cash to be used for operations during the restructuring process. The company has filed a motion to request to pay employees and continue their benefits, but has not requested approval to restart user withdrawals.
